Beazer Homes USA, Inc. (BZH)

housing market still has a while before it will bounce back, that is, if it will with all of Obama's spending.

Zacks Rank 4-Sell, Recommend Neutral, Industry Rank 72 / 217, Target 4.80, Avg Target of 7 analysts 4.25

Lots O' debt. As we work off the excess housing inventory and first time buyer stimulus recedes the homebuilder recovery might appear a bit premature.

This stock is bleeding cash. The only good thing is that it's bleeding less money than it used to but based on the last time it was profitable, Beazer would need RE prices to back to 2006 and 2007 levels and that just isn't happening in the near future. The company isn't going to go bankrupt anytime soon since their debt is reasonably spread out but they're just not making money on the sales of their homes. Gross profit of 5M for the quarter ending june 2009 doens't come close to covering the rest of their expenses. I fully expect home prices to take a dive or at best remain stagnant. In that case BZH will really be in dire straits... their inventory is probably over valued but every home they sell will come at a loss. chicken or egg, this stocks going down.

Mountains of debt, long term problems affecting the housing market, yet it's up 400% YTD and trading at a 12 month high. I'm down on Pulte and Beazer's in much worse shape.

per floridabuilder

With the next down-leg in the housing market now beginning, and the next big down-leg in the stock market due to begin any week now, it's time to bring this one out, dust it off and short it for some more easy money.

We may be seeing a bottom in housing, but I doubt we are near a recovery. With interest rates projected to rise, high unemployment and the collapse of the housing market still fresh in people's minds, I don't see a new homebuilding and buying spree in the near future. Inventories, while down over the year, are still running at 9+ months. An $8000 tax credit is enticing, but its ending soon and I don't see many homebuyers saying "if only I had another 8000, I could finally afford a house." Then again, there is a history of some buyers making poor decisions as it relates to home buying...
As for the numbers, BZH is hemoraging cash, has high debt and while its recent earnings beat expectations, it was far from impressive. It is still projected to lose money through next year. I took a loss by selling it recently (I called its bottom a little too high), but I'll at least get a tax break. Its recent run upward made now an enticing short-term exit point. I don't see any upside in the near future, and think BZH is massively overvalued. I'll be waiting for a much lower entry point (and at least 19 more days) to reacquire and hold.

Rebound's gonna come.

Come on guys really? Who is buying this garbage and making the price rise 50% in the last few weeks? Oh well, another fine opportunity for a short!

ZERO

It has been beaten, and it is turning now

I know Sleazer homes well. I wouldn't bet on this company going bankrupt because they can offer massive dilution. However, their cash to debt ratio is one of the worst in the industry and similar to a private builder. Additionally, based on the number of lots they own finished, they are going to have a huge negative cashflow problem by next year. Raw lots require a significant amount of cash burn and they do not have the capability to really buy new finished lots on rolling takes. Another big issue with Sleazer is that they are in too many markets with smaller positions (overheads) vs in fewer markets with bigger footprint.

This is a red thumb to under $1 again

trend PS test

worst 30days caps

I'd love to short them, but can't borrow their stock anymore!

rally picks

going back down

undervalued.. raise in value of US dollar will help stabilize housing to a small %. will lead to slight stabilization of housing market's current downward spiral.. bottomed.